NEXTDC launches $2.2 billion expansion plan in Australia

In a major move to meet surging demand, Australian data centre leader NEXTDC has launched a $2.2 billion capital plan. The ASX-listed company announced a trading halt to facilitate a fully underwritten $1.5 billion equity entitlement offer, complemented by a $700 million expansion of its hybrid securities program. This substantial financial maneuver is a direct response to unprecedented growth, with the company’s pro forma contracted utilisation soaring by 250 megawatts in the March quarter alone, a 60% jump that brings the total to 667MW.

This explosive demand, primarily from hyperscale cloud providers and AI infrastructure customers, also propelled the company’s forward order book up 83% to 544MW over the same period. The equity raise is structured as a 1-for-5.4 pro-rata accelerated entitlement offer, priced at $12.70 per share. Prior to the suspension, NEXTDC shares had climbed roughly 25% in April, mirroring broader investor excitement for data centre infrastructure across the Asia-Pacific region.

A cornerstone of the funding strategy is the deepened partnership with La Caisse de dépôt et placement du Québec (CDPQ). Canada’s second-largest pension fund has increased its binding commitment to the hybrid securities program from $1 billion to a total of $1.7 billion. The firm described this as a promising initial step toward a long-term strategic alliance with NEXTDC.

The primary objective for the raised capital is the accelerated development of the S4 campus in Western Sydney. The company plans to invest approximately $1.5 billion into the site through the end of the 2027 financial year. This push was triggered by a record 250MW customer commitment at S4 last quarter. CEO Craig Scroggie stated the capital raise will materially expand contracted capacity and de-risk the Western Sydney developments ahead of potential strategic partnership transactions with private capital partners from 2027 onward, a common path for monetizing large-scale infrastructure.

The accompanying financial guidance underscores the scale of this expansion. NEXTDC has increased its FY26 capital expenditure guidance by $300 million, now forecasting a range of $2.7 to $3.0 billion. For FY27, capex is projected to reach roughly $5.0 billion. While maintaining its existing FY26 revenue and EBITDA forecasts, the company projects that contracted EBITDA from current customer agreements will eventually surpass $1 billion, vastly exceeding current guidance. Post-raise, NEXTDC anticipates a pro forma liquidity position of approximately $5.9 billion.

The company’s ambitious growth occurs within a rapidly transforming national market. Australia’s current deployable data centre capacity is about 1,350 megawatts, with industry forecasts predicting it could reach 3,100 MW by 2030-31 and potentially hit 7.4 gigawatts by 2035 under AI-driven scenarios. In New South Wales, the state’s Investment Delivery Authority has fast-tracked $51.9 billion in data centre projects, consolidating approvals and critical grid connections with a select group of qualified operators like NEXTDC.

With 20 facilities operating or under development across Australia and sites under evaluation in key Asian markets including Tokyo and Singapore, NEXTDC is positioning itself at the forefront of this infrastructure boom.